The Weekly Rant: Starting Pitching Market Trends

 

The offseason is finally winding down, with just a few significant free agents still out there. The highest upside players available are mostly starting pitchers.  While Kendrys Morales, Stephen Drew, and Nelson Cruz are still unemployed, the real impact players left are Ubaldo Jimenez, Ervin Santana, and AJ Burnett.

Some may have anticipated the sluggers waiting on the market, but the high quality starting pitching for hire is surprising.  Burnett has always been in control of his market, so the choosy 36-year-old looking for the perfect one-year deal isn't really an indicator of the market.  But youngish, goodish, durable guys like Jimenez and Santana should have signed their lucrative deals by now, right?

I mean these were pitchers who were close to the top on most people's free agent rankings.  Among the 18 domestic pitchers in MLBTR's Top 50 Free Agent rankings, Santana and Jimenez were ranked No. 1 and No. 5 respectively.  And with older hurlers Kuroda and Burnett ahead of him, the up-and-down Jimenez was actually in-line for the third largest contract among free agent pitchers.

There's a couple reasons why they are still out there.  The obvious reason is they haven't received a contract offer they like.  The big reason why they haven't gotten that kind of offer yet (or why they never will) is because of the Masahiro Tanaka sweepstakes.  Tanaka split the market for starting pitchers into two segments. You either signed before he got posted, or you signed after he did.  No major league deals with starters went through while the Tanaka drama was unfolding. Check out the flurry of activity and then the long gap:

Dec. 3:  Ricky Nolasco signs with the Twins.
Dec. 4:  Scott Kazmir signs with the A's.
Dec: 5:  Phil Hughes signs with the Twins.
Dec. 6:  Scott Feldman signs with the Astros.
Dec. 7:  Hiroki Kuroda signs with the Yankees.
Dec. 14: Bartolo Colon signs with the Mets.
Dec. 16: Posting System Agreement is reached.
Dec. 26: Masahiro Tanaka is posted.
Jan. 22:  Tanaka signs with the Yankees.
Jan. 26:  Matt Garza signs with Brewers.

Obviously teams weren't going to keeps signing players at the rate they did leading up to the winter meetings (or else everybody would have been signed in 45 minutes), but there's no denying it held everybody up. Besides the actual process surrounding Tanaka, the uncertainty of his availability (along with Burnett's more recent drama) also had an effect on the market.

Now I can't prove that the presence of Tanaka will actually reduce the money other starters receive (I think it will a little, especially for a guy like Santana, who the Yankees may have been in on.).  But it definitely pushed the market back about a month.

I decided to take a look at the contracts starting pitchers were projected to sign, compared to the contracts they actually did sign.  I used the previously mentioned Top 50 Free Agent list from MLBTR, and used the predictions from their various free agent profiles of starting pitchers.  I left off Tanaka, Suk-Min yoon, Jason Hammel, and Roy Halladay. These are predictions made by industry experts, and while they are not perfect, they are pretty good.

Rank	Name	Projected		Actual
		Years	Total $	Years	Total $	Date
1	Santana	5	75
2	Garza	4	64	4	50	26-Jan
3	Kuroda	1	16	1	16	7-Dec
4	Burnett	1	12
5	Jimenez	3	39
6	Kazmir	2	16	2	22	4-Dec
7	Nolasco	3	36	4	49	3-Dec
8	Colon	1	10	2	20	14-Dec
9	Arroyo	2	24	2	23.5	10-Feb
10	Feldman	2	17	3	30	6-Dec
11	Johnson	1	8	1	8	20-Nov
12	Hudson	1	9	2	23	18-Nov
13	Haren	1	10	1	10	25-Nov
14	Vargas	3	28.5	4	32	21-Nov
15	Hughes	1	8	3	24	5-Dec
16	Maholm	1	7	1	1.5	8-Feb

You can see there are some notable discrepancies.  There are also a few that are right on.  Remember, some of these deals have important non-guaranteed elements, such as vesting options (Garza or Haren) or incentives (Maholm). Draft pick compensation will also be important to consider when Jimenez and Santana sign.  But there is still a lot going on in this data.

I decided to look at the date the contracts were signed.  This graph has the difference between the total value of the actual contracts and the total value of the projected contracts for each player on the y axis, and the date each player signed on the x axis (It's recorded as "days after Nov. 1", so that January 1= 61 days.)

Overall, the predictions were low (the new TV contracts likely resulted in double digit salary inflation). But the graph really looks like two sets of data when organized like this.  It's pretty clear where the Tanaka sweepstakes took place.  But the difference between the early and late contracts is pretty striking.

At the beginning of the offseason players were getting the same or more in average annual value or years, or both, than they were expected to.  The three domestic starting pitchers to sign in 2014 have all gotten the same or less in all of those categories.  Now this might change a little. If Burnett is really testing the market, he will likely get more than $12 MM.  And, Jimenez should still be able to land north of $39 MM. 

But Santana will probably come in at way under $75 MM.  And you could add another data point in the early signers column if we included Tim Lincecum.  His 2-year, $35 MM contract certainly blew away expectations, and may have been what set the bar so high, at least early in the offseason.

Overall, it seems this year that if pitchers signed early in the offseason, they earned more than expected. For guys signing later in the offseason, (It's only three guys so far), things don't seem so good.  Looking at it from the team perspective, adding your rotation help early didn't generally result in any savings.  It has certainly been an interesting free agent period for starting pitching, and it's not over yet.